The beginning of summer can be an expensive time of year. Folks prepping their outdoor areas for entertaining, landscaping, buying that new BBQ or shed. These are all big purchases. So how can your business help your customers make those purchases easier on their budgets? Al welcomes Brian Weiner, Vice President, Head of Product and Digital at VISA Canada on the podcast to talk about a potential solution, VISA Installments.
The beginning of summer can be an expensive time of year. Folks prepping their outdoor areas for entertaining, landscaping, buying that new BBQ or shed. These are all big purchases.
So how can your business help your customers make those purchases easier on their budgets? Al welcomes Brian Weiner, Vice President, Head of Product and Digital at VISA Canada on the podcast to talk about a potential solution, VISA Installments.
Also in this episode:
Chapters:
Al Grego:
Coming up on Shop Talk.
Brian Weiner:
I mean, the concept of buy now, pay later has actually been around for many, many years. Companies have had layaway plans for a long, long time. There's really nothing new to that. Over the past few years, the FinTechs have come along and have modernized that process and made it very simple for somebody to go and make a purchase and pay it out over two or three payments using the FinTech's offering.
Al Grego:
Hello, everyone. I'm Al Grego.
Neetu Sidhu:
And I'm Neetu Sidhu.
Al Grego:
And this is the June 2022 edition of Shop Talk with Moneris. Welcome to Shop Talk Podcast, Neetu.
Neetu Sidhu:
Thanks for having me, Al.
Al Grego:
It's my pleasure to have you on all the way from Calgary. Now, the reason I invited you is that you're the Director of Diversity, Equity and Inclusion at Moneris.
Neetu Sidhu:
That's right.
Al Grego:
And June just so happens to be National Indigenous History Month in Canada.
Neetu Sidhu:
It sure is, yep.
Al Grego:
I just recently did a story on the Yes, We Are Open! Podcast about the Parry Sound Friendship Centre and all the great work they're doing for the indigenous people in that area.
Neetu Sidhu:
I listened to that episode. I love the work they're doing and it sounded like your visit there really left a great impression and it was a powerful moment for you.
Al Grego:
It was quite the experience to witness all their good work, but also, I got to visit Wasauksing First Nation and interview one of their elders.
Neetu Sidhu:
Wow, that's amazing. So much wisdom and just richness in the culture and heritage, I bet.
Al Grego:
I really enjoyed learning more about the history of that area And I think it's important for all Canadians to learn more about that history and the history of the people who occupied this land before us.
Neetu Sidhu:
Honestly, I completely agree. First Nations, Inuit, and Metis people are the first people of this country. They have such rich histories and diverse cultures, and unfortunately, they're just not broadly recognized and really warrant greater understanding and appreciation, especially from people like you and me who are settlers on this land. June, as you said, is Indigenous History Month in Canada. It's an opportunity for all of us to continuously learn about the cultures, the languages, the connection to land that indigenous peoples have, as well as the significant contributions of indigenous peoples to our country.
It's also an opportunity to sit with some of the horrific truths of residential schools. The Indian Act Sixties Scoop and the resulting intergenerational trauma that is primarily causing a lot of the social, economic and health-related struggles that a lot of indigenous peoples live with today. I encourage everyone who's listening to today's podcast to dedicate time to learning more about the sacrifices, the injustices, as well as the beautiful diversity, wisdom and contributions of indigenous peoples. If you don't know where to start, honestly, Google has a ton of great resources at your fingertips.
Al Grego:
I promise you that this won't be a one shot thing. I've already got at least one other and maybe two more indigenous merchants lined up for season three of the podcast. I can't wait to tell those stories as well.
Neetu Sidhu:
I'm really looking forward to that. Thanks for the work you do too, Al, just to make sure that we do build that inclusion and that diverse perspective into the podcast that you do. It's awesome.
Al Grego:
Well, I appreciate you saying so. I'm just happy to do my part. Let's go on to talk about the theme of this month's episode. Neetu, do you know what one of the signs that summer's arrived is?
Neetu Sidhu:
Warm weathers, Slurpees, sun.
Al Grego:
Yes, but-
Neetu Sidhu:
Oh, mosquitoes. I hear you get a lot of mosquitoes in Ontario.
Al Grego:
Well, we do, but I was thinking more along the lines of spending habits.
Neetu Sidhu:
Ah, okay. I would think that summer is not as expensive in terms of spending as the holiday season.
Al Grego:
Well, yes, the holiday season is an expensive time, but I think leading into summer, I don't know about you, but summer usually means summer projects.
Neetu Sidhu:
Ah, yeah. Makes sense.
Al Grego:
For example, last year, I built a patio. This year, I need to buy a shed. These are large expenditures. Do you have any projects coming up?
Neetu Sidhu:
Yeah, actually just a few weeks ago, my basement unexpectedly flooded.
Al Grego:
Oh, wow.
Neetu Sidhu:
An Eavestrough elbow broke off and filled a window well with water and gushed water into my basement.
Al Grego:
Oh, wow.
Neetu Sidhu:
Currently, I'm restoring that, installing a new window well and getting a new deck put in. The other thing is, or the cost of raw materials has gone up because over the course of the pandemic, people are essentially investing all the money that they would've maybe traveling into their homes.
Al Grego:
That's right. As you know, summer projects aren't cheap and these are some pretty large expenditures. As a business owner who perhaps specializes in these larger ticket items, the challenge is providing potential customers with the best ways to pay for these purchases. Not everyone has large sums of money on hand.
Neetu Sidhu:
It would be great if we could present some sort of a solution and I feel like you might have one actually.
Al Grego:
Well, we're going to talk about a new way that business owners can help their customers make those larger purchases more manageable. I'm going to be talking with Brian Weiner. He's the Vice President, Head of Product and Digital from Visa Canada, and he's going to talk about their newest product called Visa Installments.
Neetu Sidhu:
Nice. Sounds super interesting.
Al Grego:
Then we also have Kip Macartney. He's our Director of Emerging Solutions and Value Added Services. He's our expert here and he is going to talk about how Moneris is going to enable installments for our merchants.
Neetu Sidhu:
I'm a huge Kip fan, so your listeners are definitely in for a treat.
Al Grego:
Yes. Then, of course, our data guy, Sean McCormick takes it from theory to practice with some real consumer spending data.
Neetu Sidhu:
Sounds like a great lineup. Who's up first?
Al Grego:
Well, first up is my interview with Brian from Visa.
Speaker 3:
Featured interview.
Al Grego:
Today, I'm joined by Brian Weiner. He's the Vice President and Head of Product and Digital at Visa Canada. Brian, thank you so much for joining me today.
Brian Weiner:
Thank you very much. It's great to be here.
Al Grego:
The theme for this month's episode is summer projects and because, I mean, it's June and speaking personally, I've got some landscaping that I have planned and I want to buy a shed. There's some pretty big ticket items that I'm going to be spending some money on this month. Visa has a product that might help me with that. Can you tell me a little bit about this?
Brian Weiner:
For anybody who's following the payments business, there's a movement that's sort of taken hold over the course of the past few years and it's been around buy now, pay later. We have a service that is called the Visa Installment service that we are launching into market and we're launching it with Moneris right now, actually. This is really going to enable somebody to make a purchase on their Visa card like they always have, yet pay it out over time in an installment. And so, if somebody had wanted to buy a new shed for their backyard and it was a $300 purchase, they wanted to spread that out over two payments or three payments or four payments or whatever number of payments they wanted, they would be given that option at the point of sale.
Al Grego:
I'm a little confused, Brian, because I mean, isn't that kind of what a credit card is anyway, kind of buy now, pay later? How are Visa Installments different?
Brian Weiner:
I mean, the concept of buy now, pay later has actually been around for many, many years. Companies have had layaway plans for a long, long time. There's really nothing new to that. But if somebody wanted to go and do a transaction where they were taking advantage of a pay over 12-month offer or taking advantage of a 0% financing offer or something like that, they had to go and stand over at the side counter of the store. They had to fill out a form. The store probably had to go and do a credit check on them. They had to read a 12-page contract and then wait, and then three days later, it would get put into place.
Over the past few years, the FinTechs have come along and have modernized that process and made it very simple for somebody to go and make a purchase and pay it out over two or three payments using the FinTech's offering. What we're now doing is we're taking that concept and we're really incorporating it into the DNA of a Visa transaction, such that the options would be made available to you at the point of sale, whether you're buying something in a store or whether you're buying something online. No other credit checks required. It all works into the existing line that you have available on your credit card today. If somebody had a $2,000 limit on their card, this would just get worked into that.
With the other offerings that exist out in market, it's another loan, it's another contract with a company that you've never heard of. It's something else to have to manage and track. Here, we're simply taking your existing Visa credit line and we're making it available to be able to introduce this kind of an offering at the point of sale and all consolidated into that existing credit line.
Al Grego:
Interesting. Practically, how does this look? For example, let's say I'm making $1,000 purchase for one of those high-end sheds. What does that look like on my Visa bill?
Brian Weiner:
Well, with respect to the actual process of doing the transaction, you are at the cash register in the store. You dip your card into the Visa reader as you normally would, and rather than just putting in your pin right away, it might say to you, assuming the merchant accepts it, it would say to you, "Hey, would you like to pay this out in installments? Pick one of these couple of options that were available." You would pick one and then that would be it. Then what would happen is for you, the consumer, if it was $1,000 purchase and you're paying it out over 10 months, $100 would be due from you to the credit card issuer on each of those statements for the next-
Al Grego:
Rather than having $1,000 balance on your credit card statement that you're looking at and you're stressing over because you're worried about... It's the installment each month that you're seeing on your bill, not the full amount.
Brian Weiner:
Exactly.
Al Grego:
Interesting.
Brian Weiner:
Exactly. The beauty of it from a merchants' perspective, the merchants continues to get paid right away the same way they always have. Nothing changes from the merchants' standpoint. In the case that you just described, the merchant would receive $1,000-
Al Grego:
In full.
Brian Weiner:
... later that day or the next day, whatever their arrangement was with Moneris. They would be done and the installment payments would just really be between the consumer and their bank.
Al Grego:
That's great. That sounds amazing. If you're a small business or if you're any kind of business who wants to offer up some kind of installment payment program, this would be a pretty easy thing to implement then.
Brian Weiner:
Yes. It's extremely simple. I mean, Moneris has done such a great job integrating to this service and they're putting it out to their thousands of merchant customers now. The beauty for the merchant is that this is all very seamless. This is all just part of the flow of a Visa transaction as they're used to, as they've become accustomed to for many, many years here in Canada. It's one little extra step that gets added into the process. The other beauty for the merchant is that they're able to increase their basket size, and statistics will show that merchants that adopt these kinds of offerings will increase their basket size.
Al Grego:
Many of our listeners are entrepreneurs and small business owners. Will this be broadly available to them?
Brian Weiner:
Well, Moneris has done a really, really great job of getting ahead of the curve on this and Moneris has gone out and integrated with our service. Any merchant that is a Moneris merchant will be able to take advantage of this type of offering.
Al Grego:
That's great. Regardless of size of business, if they're a Moneris customer, they can turn this on as of now?
Brian Weiner:
Yes.
Al Grego:
That's great. When did this product launch?
Brian Weiner:
We're right at the beginning stages of this product, but the early signs that we have are extremely promising. I've been in this industry for 16 years now and I can't think of another product that we've launched that has launched with so much fervor across both our issuers that issue cards to consumers, as well as our acquires like Moneris that sign up merchants to accept. We think that we're going to be almost at ubiquity on the consumer side in terms of consumer adoption, meaning their cards will be eligible for the service. The next step for us is to build out our merchant acceptance.
Al Grego:
You don't need to be a Visa card carrier to take advantage of this, is that correct?
Brian Weiner:
This is a Visa service that we're making available. If you're a merchant and you accept Visa cards and you accept cards of other networks, the technology will still work. As long as the financial institution has enabled for the service, regardless of whether it's a Visa card or the card from a different network, the installment service is going to work.
Al Grego:
Amazing.
Brian Weiner:
It's network agnostic, we call it.
Al Grego:
That's great. If I wanted any more information or learn more about this product, where would I go?
Brian Weiner:
Well, to learn more about the product, merchants really are encouraged to get in touch with Moneris and talk to them about it. There will be information that will be available on the Visa website as well. If they go to visa.ca/installments, they can find out information about the product directly on our website, but we always encourage merchants to get in touch with their acquire, in this case, Moneris, to talk about this and to take advantage of.
Al Grego:
Thank you so much, Brian, for your time today.
Brian Weiner:
Thank you very much. Appreciate you having me.
Mat Belanger:
This podcast is brought to you by Moneris. Today has shown us tomorrow has changed, changed how we'll live, work and do business because now we're more open to what's possible, open to contactless payments, online bookings, curbside pickups, and more. Open your business to more opportunity with solutions to help you succeed online, in store, or on the go. To talk to one of our business advisors, call 1-866-MONERIS or visit moneris.com today.
Speaker 3:
By the numbers.
Al Grego:
I'm joined by Sean McCormick. He's the Director of Sales and Marketing for Spendscape. Thank you so much, Sean, for joining me today.
Sean McCormick:
My pleasure, Al.
Al Grego:
This month, we're talking about summer projects and I mean, I don't know about you, but I'm looking forward to spending some time in my backyard and I've got a few big expenditures coming up, a new shed. Last year, I put a bunch of money into a patio in the front of my house. Obviously, it's the time of year to do that. It's the time of year to spend a little bit more money on these projects.
Sean McCormick:
Right. You spent your money on your patio last year. I did the same thing on a number of projects around my house. It seems like what we're seeing this year is the landscaping, horticultural, pools, installations. That's all down over the same period last year. Landscape and horticultural down 29% year-over-year. Pools sales and service down 13%. Now, let's give that some context. Last year at this time, year-over-year pool sales and service was up 143%.
Al Grego:
Wow.
Sean McCormick:
Landscape and horticulture was up 61%. There was a slingshot effect happening through a number of consumer-spending categories last year, not the least of which was outdoor related improvements. To expect that to continue would be unreasonable. It's actually, I believe, really healthy for our economy that this is pulling back a little bit. You can't have a slingshot continue to go forward forever. That's not healthy for inflation. The sooner we get back to normalized consumer spending trends, I believe is going to be better for the economy. It's going to be better for inflation, which is ultimately better for consumers.
Now, there are a couple of categories in consumer spending related to the home that did show year-over-year increases on top of impressive increases last year. Art dealers and art galleries up 28% year-over-year. This one, indoor furnishing. Furniture and home furnishings, the category is up 33% year-over-year.
Al Grego:
Wow.
Sean McCormick:
This time last year, it was up 327% year-over-year.
Al Grego:
It's crazy.
Sean McCormick:
We had that massive spike coming out of COVID and then it's still going up one-third year-over-year comparison. Maybe people did what they needed to do in their yards and now they walked inside this winter and went, "What can I do inside of my house?"
Al Grego:
They're saying, "My backyard's nicer than the inside of my house now."
Sean McCormick:
That's right.
Al Grego:
What about contracting? I mean, it's been up for the last couple years.
Sean McCormick:
Well, if you try to book a contractor sometime in the last 12 months, you probably understand the demand within this category. I think a lot of people listening to this podcast might have thought, "Hey, what about a career shift? I can handle a drill. I know how to work a Skilsaw." General contractors year-over-year, month of April, up 11%. That just continues a steady trend over the last couple of years as people have, they identify a need for an improvement in their yard or in their house, some kind of an improvement to spend this money that they've saved up. Clearly, there's still money there to be spent because as I said before, with a continued year-over-year increase on top of the massive increases year-over-year last year, it's truly impressive to see that continuing in any categories where it's continuing to go up.
Al Grego:
I wonder if some of this is also people using the equity in their homes since housing prices have gone up significantly as well over the last few years.
Sean McCormick:
Well, that's a good point, Al. It's also a concerning point because no two people have exactly the same equity in their house. There may be people with $1 million in equity in their house, so they got a lot of chips to play with. There may be others that just bought in the last couple years who might only have 50 or 60 grand in equity. If there is any kind of a market correction in the real estate market, that could turn upside down real quick if it's some kind of a cash leverage position on their mortgage.
Al Grego:
Good point. All right. Thank you so much, Sean, for joining me today.
Sean McCormick:
Thanks, Al.
Speaker 3:
Ask an expert.
Al Grego:
Joined by Kip Macartney. He's the Director of Emerging Solutions and Value Added Services for Moneris. Kip, thank you so much for joining me today.
Kip Macartney:
Thanks so much for having me. It's always a pleasure.
Al Grego:
Earlier in the episode, I spoke with Brian from Visa and he was talking about the Visa Installments, something you know a lot about. As the expert on our team, I was wondering if you talk about the Moneris side of things, like what are we doing to enable this installments program?
Kip Macartney:
First, thanks for the time. Second, the Visa partnerships that we have with this program's been absolutely fantastic. We're working really closely with them to make sure that our offering is something that our merchants can consume and use very easily. The way that we've actually taken in what Visa's built and then are offering it to our merchants is we're starting with e-commerce first with our Gateway API and then our Moneris Checkout to follow. Then from there, we'll be launching our physical devices over this next 6 to 12 months, and that will allow us to kind of make sure that if there's the potential for another lockdown, our merchants can still service their customers in an e-commerce environment with that curbside pickup solution that they've been doing so well for the last two years.
Al Grego:
We're actually starting with digital first.
Kip Macartney:
We are trying to do that. It's a priority for the organization and we think that it's the path forward for us. Face to face is obviously very important as well, so it's not been forgotten. It's just something that we need to spend a little bit more time on to focus.
Al Grego:
We know kind of what it is and how it works. As a Moneris merchant, how difficult or easy is it to employ? I'd like to turn it on.
Kip Macartney:
If you're already using our API, there's a little bit of user experience work that you'll need to do so that you can present different tenures of installment, say a 6-month installment plan or a 12-month installment plan. There's a few other compliance things that aren't really major. What we've been hearing from our merchants that are working with us right now is it's about a two to three-week work effort to actually implement the API test and be ready to go. We're very excited about that. That's certainly a fast turnaround.
For our Moneris Checkout users, which we are working diligently on bringing out over the summer, it will be an overnight upload. We control the user experience so that our merchants don't have to use a developer once they're programmed into our Moneris checkout and so, the turn on will, all of a sudden, if a card is eligible for installments, we'll just present, "Oh, you're eligible for a three-month plan and a six-month plan." If a consumer is not eligible for installments, it'll just say, "Oh, please pay for your $300 expense here." The way that it always has so that your consumer doesn't have that negative impact of being declined at a point of sale.
Realistically, we're looking for a 20 to 30% average ticket size increase, which the data supports across all industries. Some industries in things like appliances have had previous experience with this where they see a 60 to 90% increase in average ticket size where installments are used.
Al Grego:
Wow.
Kip Macartney:
That's significant. It's huge. That's particular to some merchants. It's not statistically significant across the entire portfolio of Moneris, but we do know that some merchants are taking full advantage of this and when their consumers use an installment plan, they're taking the opportunity to upgrade their appliances that they're getting or upgrade the item that they're getting sometimes 2X. That's a real value proposition and worth a small expense.
Al Grego:
Great. Well, thank you so much, Kip, for taking time for me today.
Kip Macartney:
Well, thanks, and looking forward to the next time.
Speaker 3:
Save the date.
Al Grego:
I'm joined by Amanda Ibrahim. She's the Communication Specialist on the Events and ESG team. Amanda, thank you for joining me today.
Amanda Ibrahim:
Thanks for having me, Al.
Al Grego:
I hear we have a long list of events for June.
Amanda Ibrahim:
We have a busy month ahead of us.
Al Grego:
Well, why don't we get started? What do you have for us?
Amanda Ibrahim:
On June 4th, Sean McCormick will be hosting a workshop for the Federation of Canadian Municipalities using consumer spending data to drive recovery.
Al Grego:
Where do we find out more about this event?
Amanda Ibrahim:
To find out more, visit the Federation of Canadian Municipality's website.
Al Grego:
Very good.
Amanda Ibrahim:
On June 11th, Moneris is a proud sponsor of the Second Harvest Toronto Taste. It'll be the 30th anniversary celebration at Evergreen Brick Works where the best of the best of the city's food scene come together for one spectacular evening in support of Second Harvest, Canada's largest food rescue charity.
Al Grego:
Sounds delicious. Where can we learn more about that?
Amanda Ibrahim:
To find out more, visit torontotaste.ca.
Al Grego:
What's next?
Amanda Ibrahim:
On June 14th, our CEO and President, Angela Brown will be participating in a fireside keynote hosted by ETA TRANSACT Tech on the state of payments. June 14th to 17th, Rob Wilkinson, our VP of B2B Sales will be presenting at the National Credit Conference in Banff, Alberta.
Al Grego:
Lucky him. What's next?
Amanda Ibrahim:
From June 17th to 19th in Montreal, the F1 Grand Prix du Canada will take place. Moneris will have onsite branding at the event.
Al Grego:
Where can people learn more about that?
Amanda Ibrahim:
Check out our social channels that week to get more updates.
Al Grego:
What's next?
Amanda Ibrahim:
Moneris is sponsoring a three-part webinar series with Small Business BC this summer. The first one kicks off on June 23rd. Ashley Jamieson, our Product Manager at Moneris, will be presenting How to Run a Successful Food and Beverage Business.
Al Grego:
How would you register for that?
Amanda Ibrahim:
You can register on the Small Business BC website, smallbusinessbc.ca.
Al Grego:
Any other events?
Amanda Ibrahim:
The eCommerce North Accelerator applications are now open for the third cohort. Those will be open until July 13th and the cohort will run from September 14th to December 13th.
Al Grego:
Wow. That's a lot of stuff happening in June.
Amanda Ibrahim:
It sure is, Al. It's great to see in-person events coming back into play. If anyone wants additional details, keep an eye on our social channels.
Al Grego:
Very good. Thank you so much.
Amanda Ibrahim:
Thanks, Al.
Al Grego:
That's all we have for this month. I hope you found this episode informative. Before we sign off, I'd like to let everyone know that season two of Yes, We Are Open! Podcast just wrapped up. It's eight stories of eight different small Canadian businesses. I tell their origin story, the story of their greatest struggle, and how they overcame that struggle. Here's a teaser.
Right now, you can binge season two of the Yes, We Are Open! Podcast. Eight Canadian businesses with eight stories of perseverance.
Speaker 9:
Yes, we're open.
Speaker 10:
Yes, we are open.
Speaker 11:
Yes, we are open.
Speaker 12:
Yes, we are open.
Speaker 13:
Hell yeah, we're open.
Al Grego:
Subscribe now to Yes, We Are Open! Available wherever you get your podcasts.
Speaker 14:
(Censored) yes, we're open and we're not going anywhere.
Speaker 15:
I love it. That's great.
Speaker 14:
We're here to stay.
Speaker 15:
Perfect.
Neetu Sidhu:
If you haven't already, you can subscribe to this podcast and Yes, We Are Open! wherever you get your podcast.
Al Grego:
If you'd like to support this show, share this podcast with your network or review us on Spotify or Apple Podcast. Finally, if you have a payment related question you'd like to submit to one of our experts, you can email us at podcast@moneris.com.
Neetu Sidhu:
Join us again next month for more expert insight and data to help you grow your business.
Al Grego:
Neetu, thank you so much for co-hosting today.
Neetu Sidhu:
It was so fun. Thanks so much for having me.
Al Grego:
On behalf of Neetu, myself, and the rest of Moneris, thank you for listening to Shop Talk. Talk again in July.
Neetu Sidhu:
Take care, everyone.